Question

Document and Entity Information - USD ($) 12 Months Ended Feb. 03, 2018 Mar. 08, 2018 Jul. 29, 2017 Document and Entity Information Entity Registrant Name TARGET CORP Entity Central Index Key 0000027419 Document Type 10-K Document Period End Date Feb. 03, 2018 Amendment Flag false Current Fiscal Year End Date --02-03 Entity Well-known Seasoned Issuer Yes Entity Voluntary Filers No Entity Current Reporting Status Yes Entity Filer Category Large Accelerated Filer Entity Public Float $ 30,595,914,184 Entity Common Stock, Shares Outstanding 538,796,010 Document Fiscal Year Focus 2017 Document Fiscal Period Focus FY

Mailing Address 1000 NICOLLET MALL MINNEAPOLIS MN 55403

Business Address 1000 NICOLLET MALL MINNEAPOLIS MN 55403 6123046073

TARGET CORP (Filer) CIK: 0000027419 (see all company filings)

IRS No.: 410215170 | State of Incorp.: MN | Fiscal Year End: 0131
Type: 10-K | Act: 34 | File No.: 001-06049 | Film No.: 18689122
SIC: 5331 Retail-Variety Stores
Assistant Director 2

Use Target Corporation’s most recent annual report, to calculate:

1. Current ratio
2. Times interest earned
3. Liabilities-to-equity ratio
4. Return on equity
5. Return on assets
6. Financial leverage

Show calculations for each of the ratios.

Answer 1

Calculations are made using the annual report for the year 2017

Amounts are in millions

Calculation of current ratio:-

Total Current assets = $12,564

Total current liabilities = $13,201

Current ratio = Current assets / Current liabilities

= $12,564 / $13,201

= 0.95

Calculation of Times Interest earned ratio:-

EBIT = $4,312

Interest expense = $666

Times interest earned ratio = EBIT / Interest expense

= $4,312 / $666

= 6.47 times

Calculation of Liabilities to equity ratio:-

Total liabilities = Total current liabilities + Total non current liabilities

= $13,201 + $14,089

= $27,290

Total Shareholder Equity = $11,709

Liabilities to Equity ratio = $27,290 / $11,709

= 2.33

Calculation of return on equity:-

Net income = $2,934

Average Shareholders' Equity = ($10,953 + $11,709) / 2

= $16,806

Return on Equity = (Net income / Average Shareholders' Equity) * 100

= ($2,934 / $16,806) * 100

= 17.46%

Calculation of return on assets:-

Net income = $2,934

Total assets = $38,999

Return on assets = (Net income / Total assets) * 100

= ($2,934 / $38,999) * 100

= 7.52%

Calculation of financial leverage:-

Financial Leverage for 2017

Total Debt = Current portion of long term debt and other borrowings + Long term debt and other borrowings

= $270 + $11,317 = $11,587

Total Shareholders' Equity = $11,709

Total debt / Total Shareholders' Equity for 2017 = ($11,587 / $11,709) * 100

= 98.96%

Financial Leverage for 2016

Total Debt = Current portion of long term debt and other borrowings + Long term debt and other borrowings

= $1,718 + $11,031 = $12,749

Total Shareholders' Equity = $10,953

Total debt / Total Shareholders' Equity for 2016 = ($12,749 / $10,953) * 100

= 116.40%

Leverage has decreased from 116.40% in 2016 to 98.96%.